Workers say ethical violations are on rise

With increased pressures to meet unrealistic schedules and earning goals, illegal or unethical behavior has soared in the workplace, according to a nationwide survey of more than 2,300 workers by KPMG LLP, a professional services firm.

More than three-fourths of those surveyed said they observed unethical workplace conduct in the last year.

The main offenses included deceptive sales practices, unsafe working conditions and mishandling confidential or proprietary information. More than one-third of workers cited employment discrimination or sexual harassment.

''Corporations need to recognize that the problem is out there,'' said Winn Swenson, managing director for integrity management service at KPMG. ''Just having an ethics policy and having a bit of training is not getting the job done.''

Workers said the main problem is that companies send the wrong messages to employees on meeting business goals, and management is not willing or able to deal with unethical conduct. Other reasons for misconduct, employees reported in the poll, were low morale, pressure to meet schedules and pressure to hit unrealistic earning goals. Many also said employees are discouraged from reporting unethical conduct.

It is important that corporations deal with ethics in the workplace, Swenson said. With a tight labor market, management's commitment to business integrity strongly affects its ability to retain workers.

The survey found that two-thirds of employees would recommend their company to job candidates. But among workers who felt management condoned unethical conduct that fell to 21 percent.

The survey showed that organizations with ethics programs are ahead of the game. ''There are some companies who are doing it well and are generating consumer loyalty,'' Swenson said.

W. Michael Hoffman of the Center for Business Ethics at Bentley College in Waltham, Mass., agrees. ''If you have an ethics and compliance program in place, employees are more likely to report problems and are more likely to stay within the company.''

Penalties for corporate crime are steep, and with instant communication, ethic breaches are known around the world in a few seconds, countering years of building up a reputation, Swenson said.

Because of the 1991 law on federal sentencing guidelines, large corporations have instituted many measures, including ethics training, hotlines and senior officers to address the issue, said Richard de George, co-director of Kansas University's International Center for Ethics in Business.

Membership of the Ethics Officer Association, which is open to managers of corporate ethics, increased from 12 members in 1992 to more than 600 members in 2000, and currently 87 percent of large organizations with annual revenues of over $10 billion have full-time ethics officers.